Domestic Regulation | KPMG | BE

Domestic Regulation

Domestic Regulation

Domestic law provisions related to transfer pricing rules in the Belgian Income Tax Code.

Domestic law provisions related to transfer pricing rules in the Belgian Income Tax Code.

Domestic law provisions related to transfer pricing rules in the Belgian Income Tax Code (“BITC”) include:

  • Article 26 BITC – Treatment of abnormal or benevolent advantages granted to individuals or companies established in Belgium or abroad;
  • Article 49 BITC – Burden of proof regarding tax deductibility of business expenses;
  • Articles 54 BITC – Treatment of interests, royalties and management/ service fees paid to foreign entities which are not subject to tax or to a tax regime that is substantially more beneficial than the Belgian tax regime;
  • Article 79 and 207 BITC – Limitation of tax deductions (e.g., carry forward tax losses, notional interest deduction, etc.) against abnormal or benevolent advantages received;
  • Article 185, Section 2 BITC – Definition of the arm’s-length principle; 
  • Article 321/1 – 321/7: New Belgian transfer pricing documentation requirements; and
  • Article 344, Section 2 BITC – Anti-abuse provision (i.e., economic substance of transactions with tax haven). 

On the other hand, the Belgian tax administration has also issued circular letters and a Royal Decree addressing transfer pricing matters from a Belgian perspective:  

 

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